Opinion
19-CV-11623 (PGG) (RWL)
05-06-2021
SKYROCKET, LLC d/b/a/ SKYROCKET TOYS LLC, Plaintiff, v. COMEYUN, et al., Defendants.
REPORT AND RECOMMENDATION TO HON. PAUL G. GARDEPHE: INQUEST AFTER DEFAULT
ROBERT W. LEHRBURGER, United States Magistrate Judge.
This is a trademark infringement case in which Plaintiff seeks relief against ten Defendants who have marketed and sold counterfeit versions of Plaintiff's BLUME line of collectible dolls. By orders dated January 22 and 25, 2021, the Honorable Paul G. Gardephe, U.S.D.J., granted a default judgment and permanent injunction against ten Defendants (the “Defaulting Defendants”) and referred this matter to me to conduct an inquest on damages. For the reasons set forth below, I recommend that the Court award Plaintiff statutory damages in the amount of $50,000 against each Defaulting Defendant.
A list of the ten Defaulting Defendants appears in Attachment A to this Report and Recommendation.
Procedural Background
Plaintiff filed this action on December 19, 2019, alleging trademark infringement and counterfeiting of Plaintiff's federally registered trademarks, false designation of origin and unfair competition, and related state and common law claims. (Dkt. 6.) Plaintiff also moved ex parte for a temporary restraining order (“TRO”) and other relief. (Dkts. 12-15.)
Plaintiff also alleged copyright infringement but is not seeking damages on that basis in this default proceeding.
That same day, the Court granted the TRO. (See Dkt. 16 at p. 1.) The TRO required Defendants to appear on January 2, 2020, at a hearing to show cause why a preliminary injunction should not be issued. (Id.) The TRO also authorized alternative methods of service on Defendants. (Id.) On December 24, 2019, Plaintiff served copies of the TRO together with the summons and Complaint and all papers filed in support of Plaintiff's TRO application on each Defendant, including all Defaulting Defendants, pursuant to the methods of alternative service authorized by the TRO. (Dkt. 17.)
Plaintiff appeared at the preliminary injunction show cause hearing on January 2, 2020. None of Defendants appeared. (See Dkt. 19.) The Court then entered a preliminary injunction order (the “PI Order”) against all Defendants mirroring the terms of the TRO and extending through the pendency of the action. (Dkt. 16.) On January 7, 2020, pursuant to the alternative methods of service authorized in the TRO and PI Order, Plaintiff served each Defaulting Defendant with the PI Order. (Dkt. 18.)
On December 16, 2020, Plaintiff requested an entry of default against the Defaulting Defendants. (Dkts. 20-21.) That same day, the Clerk of Court entered a Certificate of Default against each Defaulting Defendant. (Dkt. 22.)
On December 21, 2020, Plaintiff filed its motion for default judgment against the Defaulting Defendants. (Dkts. 24-27.) The following day, December 22, 2020, the Court entered an Order to Show Cause on January 21, 2021, why default judgment and a permanent injunction should not be entered against the Defaulting Defendants (the “Show Cause Order”). (Dkt. 29.) The Show Cause Order also directed Plaintiff to serve the Defaulting Defendants by December 23, 2020. (Id.) Plaintiff did so on December 22, 2020, by serving each Defaulting Defendant with the Show Cause Order and supporting papers. (Dkt. 30.)
On January 21, 2021, Plaintiff appeared for the Show Cause Hearing. None of the Defaulting Defendants appeared. On January 22, 2021, the Court entered an Order of Default granting default judgment in favor of Plaintiff against the Defaulting Defendants. (Dkt. 32.) And on January 25, 2021, the Court entered orders granting Plaintiff's request for a permanent injunction against the Defaulting Defendants (Dkt. 33) and referring the case to the undersigned for an inquest on damages (Dkt. 34).
That same day, January 25, 2021, this Court entered an order directing Plaintiff to file proposed findings of fact and conclusions of law and supporting documents by March 8, 2021, establishing the legal and factual bases for an award of damages (the “Inquest Scheduling Order”). (Dkt. 35.) On March 8, 2021, Plaintiff filed the requisite papers, including proposed findings of fact, a memorandum of law, and a supporting declaration (Dkts. 36-38), and served the papers on each Defaulting Defendant (Dkt. 39). Pursuant to the Inquest Scheduling Order, any response to Plaintiff's inquest submission was due by April 5, 2021. None of the Defaulting Defendants filed a response.
The Court has determined that no hearing is necessary, and no party has requested one, and that this inquest can be resolved on the submissions and prior proceedings.
An inquest into damages may be conducted “on the papers,” without an evidentiary hearing where there is a sufficient basis on which to make a calculation. See Tamarin v. Adam Caterers, Inc., 13 F.3d 51, 53-54 (2d Cir. 1993); Fustok v. ContiCommodity Services, Inc., 873 F.2d 38, 40 (2d Cir. 1989); Maldonado v. La Nueva Rampa, Inc., No. 10-CV-8195, 2012 WL 1669341, at *2 (S.D.N.Y. May 14, 2012).
The facts are drawn from the Complaint (Dkt. 6), the Affidavit of Danielle S. Yamali in Support of Plaintiff's Request for Statutory Damages, dated March 8, 2021 (Dkt. 37) (“Yamali Inquest Aff.”), the Affidavit of Brieanne Scully in Support of Plaintiff's Motion for Default Judgment and a Permanent Injunction, dated December 21, 2020 (Dkt. 26) (“Scully Default Aff.”), as well as the declarations submitted in support of Plaintiff's application for a TRO, including that of Brieanne Scully, dated December 19, 2019 (Dkt. 14) (“Scully TRO Decl.”), and Giovanni Cervantes, dated December 9, 2019 (Dkt. 15) (“Cervantes Decl.”).
A. Skyrocket's Business And Its Blume Products
Plaintiff is a leading global manufacturer and tech-entertainment company that designs and sells innovative consumer electronics, gaming products and children's toys under its well-known brands, including Blume, as well as other proprietary properties, such as Pomsies, Recoil, Sky Viper, and Mebo. (Compl. ¶ 7.) Plaintiff sells its Skyrocket products throughout the United States and the world through major retailers, quality toy stores, department stores, and online marketplaces, including, but not limited to, Walmart, Target, and Amazon.com. (Id. ¶ 8.)
One of Plaintiff's most recent and successful Skyrocket products is Blume, which are collectible dolls that come in flower pots with patent-pending reveal technology that bloom when water is added. (Id. ¶ 9.) The Blume products were named one of the “Hottest Toys of 2019” and one of the most sought-after collectible dolls by Good Housekeeping, Business Insider, and Toy Insider. (Id. ¶ 12.)
The success of the Blume products is due in large part to Plaintiff's marketing, promotion, and distribution efforts. These efforts include, but are not limited to, the advertising and promotion of the Blume products through Plaintiff's website entirely dedicated to the Blume products, https://blumedolls.com/, print and internet-based advertising and publicity for the Blume products, placement of the Blume products at dozens of authorized major retail outlets, both domestically and abroad, and Plaintiff's participation in trade shows. (Id. ¶ 19.) Plaintiff has spent substantial time, money, and effort in building up and developing consumer recognition, awareness, and goodwill in the Blume products and Blume trademark. (Id. ¶ 20.) Plaintiff's success is also due to its use of high-quality materials and processes in making the Blume products. (Id. ¶ 21.) Additionally, Plaintiff owes a substantial amount of the success of the Blume products to its consumers, and word-of-mouth buzz that its consumers have generated. (Id. ¶ 22.)
As a result of Plaintiff's efforts, the quality of Plaintiff's Blume products, and the word-of-mouth buzz generated by its consumers, the Blume trademark and Blume products have become prominently placed in the minds of the public. Members of the public have become familiar with the Blume trademark and Blume products and have come to associate them exclusively with Plaintiff. Plaintiff has acquired a valuable reputation and goodwill among the public as a result of such association. (Id. ¶ 23.)
While Plaintiff has gained significant common law trademark and other rights in its Blume products through its extensive use, advertising, and promotion, Plaintiff has also protected its rights by filing for and obtaining a federal trademark registration. (Id. ¶ 14.) Plaintiff is the owner of U.S. Trademark Registration No. 5,789,875 for “BLUME” for a variety of goods in Class 28. (Id. ¶ 15.) The Blume trademark is currently in use in commerce in connection with the Blume products. The constructive date of first use based on Plaintiff's federal trademark registration for the Blume trademark is at least as early as August 5, 2018. (Id. ¶ 16.) No one other than Plaintiff is authorized to manufacture, import, export, advertise, offer for sale, or sell any goods utilizing the Blume trademark without Plaintiff's express permission. (Id. ¶ 24.)
B. The Defaulting Defendants' Unlawful Counterfeiting And Infringing Conduct
DHgate is an online marketplace and e-commerce platform that allows manufacturers, wholesalers, and other third-party merchants, like the Defaulting Defendants, to advertise, distribute, offer for sale, sell, and ship their wholesale and retail products originating from China directly to consumers worldwide and specifically to consumers residing in the United States, including New York. (Scully TRO Decl. ¶ 3.)
As reflected in other litigation involving third-party merchants offering for sale and selling infringing and/or counterfeit products on DHgate, a large number of counterfeit and infringing products are sold and/or offered for sale on DHgate. (Id. ¶ 5.) Indeed, DHgate was identified as a “particularly infamous Notorious Market” on the United States Trade Representative's Notorious Markets List. (Id. ¶¶ 6-7.)
The Defaulting Defendants conduct business in the United States and other countries by means of their user accounts and on their merchant storefronts on DHgate. (Id. ¶¶ 3, 8; Cervantes Decl. ¶ 23.) Plaintiff's investigation revealed that, without Skyrocket's authorization, the Defaulting Defendants sold counterfeit Blume products through DHgate, into the United States, including New York. (Scully TRO Decl. ¶¶ 1523 and Ex. A; Cervantes Decl. ¶¶ 23-27; Yamali Inquest Aff. ¶ 17 and Ex. D.)
C. Plaintiff's Damages
The Defaulting Defendants' failure to appear has deprived Plaintiff of the ability to confirm whether or not the Defaulting Defendants have ceased manufacturing, importing, exporting, advertising, marketing, promoting, distributing, displaying, offering for sale, and/or selling counterfeit Blume products. (Scully Default Aff. ¶ 22.) Similarly, Plaintiff was unable to engage in any meaningful discovery with the Defaulting Defendants regarding the scope of their sales, profits, and costs, among other discoverable issues. (Id. ¶ 23.)
Because of the difficulty in ascertaining with precision the full extent of the Defaulting Defendants' sale of and profit from counterfeit products, Plaintiff has elected to receive statutory damages pursuant to the federal trademark law, known as the Lanham Act, as compensation for the Defaulting Defendants' sale of counterfeit products and infringement of Plaintiff's Blume trademark. The statutory damages requested by Plaintiff are based upon an analysis of the Defaulting Defendants' wrongful use of the Blume trademark. (Id. ¶ 24 and Ex. E.) A chart detailing each Defaulting Defendant's wrongful use of the marks is attached as Attachment A to this Report and Recommendation. Supporting material for each Defaulting Defendant is cited within the chart.
Legal Standard At Inquest
At an inquest on damages following a default judgment, all well-pled factual allegations of the complaint, except those relating to damages, are accepted as true and all reasonable inferences are drawn in favor of the plaintiff. City of New York v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 137 (2d Cir. 2011) (“It is an ‘ancient common law axiom' that a defendant who defaults thereby admits all ‘well-pleaded' factual allegations contained in the complaint.”) (quoting Vermont Teddy Bear Co., Inc. v. 1-800 Beargram Co., 373 F.3d 241, 246 (2d Cir. 2004)). A factual allegation will be deemed not well-pled “‘only in “very narrow, exceptional circumstances.”'” Ideavillage Products Corp. v. Bling Boutique Store, No. 16-CV-9039, 2018 WL 3559085, at *2 (S.D.N.Y. July 24, 2018) (quoting Trans World Airlines, Inc. v. Hughes, 308 F.Supp. 679, 683 (S.D.N.Y. 1969), aff'd as modified, 449 F.2d 51 (2d Cir. 1971), rev'd on other grounds sub nom. Hughes Tool Co. v. Trans World Airlines, Inc., 409 U.S. 363, 93 S.Ct. 647 (1973)). That said, a court “must still satisfy itself that the plaintiff has established a sound legal basis upon which liability may be imposed.” Jemine v. Dennis, 901 F.Supp.2d 365, 373 (E.D.N.Y. 2012) (citing Au Bon Pain Corp. v. Artect, Inc., 653 F.2d 61, 65 (2d Cir. 1981)); accord Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009) (“[A district court] is also required to determine whether [plaintiff's] allegations establish [defendant's] liability as a matter of law”).
The plaintiff also bears the burden of establishing an amount of damages with reasonable certainty. RGI Brands LLC v. Cognac Brisset-Aurige, S.A.R.L., No. 12-CV-1369, 2013 WL 1668206, at *6 (S.D.N.Y. April 18, 2013) (collecting cases), R. & R. adopted, 2013 WL 4505255 (S.D.N.Y. Aug. 23, 2013); see also Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105, 111 (2d Cir. 1997). In conducting the inquest, the court is charged with “‘determining the proper rule for calculating damages on such a claim, and assessing plaintiff's evidence supporting the damages to be determined under this rule.'” Tiffany (NJ) Inc. v. Luban, 282 F.Supp.2d 123, 124 (S.D.N.Y. 2003) (quoting Credit Lyonnais Securities (USA), Inc. v. Alcantara, 183 F.3d 151, 155 (2d Cir. 1999)). Further, the damages award on a default judgment “must not differ in kind from, or exceed in amount, what is demanded in the pleadings.” Fed.R.Civ.P. 54(c).
Discussion
I. Jurisdiction Over The Subject Matter And The Defaulting Defendants
The Court has both subject matter jurisdiction over this case and personal jurisdiction over the Defaulting Defendants. Federal subject matter jurisdiction exists over Plaintiff's federal trademark claims pursuant to 28 U.S.C. §§ 1331 (federal question jurisdiction) and 1338 (jurisdiction over trademark, copyright, and patent claims), 15 U.S.C. § 1121 (jurisdiction over federal trademark claims), and supplemental jurisdiction over related state claims pursuant to 28 U.S.C. § 1367(a).
The Court implicitly already made this determination in entering the earlier TRO and PI Order.
The Court has personal jurisdiction over the Defaulting Defendants pursuant to NY CPLR §§ 302(a)(1), (3), for the reasons previously detailed in Plaintiff's filings in support of its motion for a default judgment. As set forth in the procedural background above, Plaintiff served all Defaulting Defendants with the requisite pleadings pursuant to the alternative methods of service previously authorized by the Court. Accordingly, Plaintiff has established personal jurisdiction over the Defaulting Defendants.
Plaintiff's Memorandum of Law in Support of Its Motion for Default Judgment and a Permanent Injunction (Dkt. 25) at 3-5.
II. Legal Basis For Defaulting Defendants' Liability
Plaintiff's Complaint and other submissions establish a sound legal basis for finding the Defaulting Defendants liable for willful counterfeiting and infringement of Plaintiff's Blume trademark.
A. Liability For Trademark Counterfeiting
Plaintiff alleges that the Defaulting Defendants engaged in trademark counterfeiting, infringement, and false designation of origin in violation of the Lanham Act, 15 U.S.C. §§ 1114(1)(a)-(b) and 1125(a). The Lanham Act imposes liability on any person who in connection with the sale, offering for sale, or distribution of a good either uses a counterfeit of a registered mark or counterfeits such mark in advertising or packaging materials when such use or counterfeiting is likely to cause confusion. 15 U.S.C. § 1114(1)(a)-(b). It also bars as false designation the use in commerce of any word, term, name, symbol, device, or combination thereof, which is likely to cause confusion as to the origin, sponsorship, or approval of a person's goods with those of another person or which misrepresents the nature, characteristics, qualities, or geographic origin of another person's goods. 15 U.S.C. § 1125(a)(1)(A)-(B).
Despite differences in the statutory language, the same legal test applies to each claim asserted here. Virgin Enterprises Ltd. v. Nawab, 335 F.3d 141, 146 (2d Cir. 2003). Courts ask whether the allegedly infringed mark “is entitled to protection” and, if so, “whether use of the allegedly infringing mark is likely to cause consumer confusion as to the origin or sponsorship of the products to which it is attached.” Cross Commerce Media, Inc. v. Collective, Inc., 841 F.3d 155, 168 (2d Cir. 2016) (internal quotation marks omitted). As to the first element, “[a] certificate of registration with the [Patent and Trademark Office] is prima facie evidence that the mark is registered and valid (i.e., protectible).” Lane Capital Management, Inc. v. Lane Capital Management, Inc., 192 F.3d 337, 345 (2d Cir. 1999). As to the second, the standard for consumer confusion is easily satisfied in the case of counterfeits “because counterfeits, by their very nature, cause confusion.” Coach, Inc. v. Horizon Trading USA Inc., 908 F.Supp.2d 426, 433 (S.D.N.Y. 2012) (internal quotation marks omitted).
Both elements are met in this case. Plaintiff owns a certificate of trademark registration for the Blume trademark. And, taking the allegations in the Complaint as true, the Defaulting Defendants' products are each virtually identical to one of Plaintiffs' products and incorporate copies or colorable imitations of the Blume trademark on their product packaging, with only minor variations that no ordinary consumer would recognize. These allegations are sufficient to support the conclusion that the Blume trademarks deployed by the Defaulting Defendants are counterfeits: the average purchaser would find the allegedly counterfeit mark to be substantially similar to the registered mark as it appears on the actual merchandise. See, e.g., Montres Rolex, S.A. v. Snyder, 718 F.2d 524, 531-32 (2d Cir. 1983) (rejecting “expert” evaluation test in favor of average purchaser test for identifying counterfeits); Horizon Trading USA, 908 F.Supp.2d at 434 (fine distinctions did not distinguish marks as not counterfeit). Accordingly, the Court finds that default judgment on Plaintiff's trademark counterfeiting and infringement claims is warranted.
B. Willful Misconduct
The Defaulting Defendants are deemed to have acted willfully, merely by virtue of their default, and consequent failure to controvert the evidence of willful misconduct alleged in the Complaint. North Face Apparel Corp. v. Moler, No. 12-CV-6688, 2015 WL 4385626, at *6 (S.D.N.Y. July 16, 2015) (citing Lane Crawford LLC v. Kelex Trading (CA) Inc., No. 12-CV-9190, 2013 WL 6481354, at *3 (S.D.N.Y. Dec. 3, 2013) (collecting cases), R. & R. adopted, 2014 WL 1338065 (S.D.N.Y. April 3, 2014)), R. & R. adopted, 2015 WL 5472939 (S.D.N.Y. Sept. 16, 2015). Even putting the fact of default aside, the conduct set forth in the Complaint and evidentiary submissions demonstrate that the Defaulting Defendants engaged in willful counterfeiting. See, e.g., Coach, Inc. v. Melendez, No. 10-CV-6178, 2011 WL 4542971, at *5 (S.D.N.Y. Sept. 2, 2011) (“Because the marks used by defendants on their products are virtually identical to the [Plaintiff] Registered Trademarks, the conclusion is inescapable that defendants' infringement and counterfeiting is intentional.”), R. & R. adopted, 2011 WL 4542717 (S.D.N.Y. Sept. 30, 2011); see generally N.A.S. Import Corp. v. Chenson Enterprises, 968 F.2d 250, 252 (2d Cir. 1992) (holding that for “the purpose of awarding enhanced statutory damages,” the knowledge component of willfulness “need not be proven directly but may be inferred from the defendant's conduct”).
Plaintiff has established the Defaulting Defendants' legal liability for willful counterfeiting and infringement of Plaintiff's registered Blume trademark.
III. Damages
As noted previously, Plaintiff seeks damages solely in connection with Defaulting Defendants' trademark violations and specifically seeks statutory damages. Plaintiff is entitled to statutory damages against each of the Defaulting Defendants.
A. Law Applicable To Statutory Damages Under The Lanham Act
The Lanham Act permits plaintiffs to elect as a remedy either actual or statutory damages for the marketing, sale, and distribution of goods with counterfeit marks. 15 U.S.C. § 1117. The range of available statutory damages is determined by whether or not the defendant's conduct was willful. Thus, statutory damages may be awarded in the amount of: (1) not less than $1,000 or more than $200,000 per counterfeit mark per type of goods or services sold, offered for sale, or distributed, as the court considers just; or (2) if the court finds that the use of the counterfeit mark was willful, not more than $2,000,000 per counterfeit mark per type of goods or services sold, offered for sale, or distributed, as the court considers just. § 1117(c). Statutory damages against a defendant who acted willfully are intended to serve the dual role of compensating a plaintiff for injuries and deterring wrongful conduct by the defendant and others. Yurman Design, Inc. v. PAJ, Inc., 262 F.3d 101, 113-14 (2d Cir. 2001); Malletier v. Carducci Leather Fashions, Inc., 648 F.Supp.2d 501, 504 (S.D.N.Y. 2009) (“where ... a defendant is shown to have acted willfully, a statutory award should incorporate not only a compensatory, but also a punitive component to discourage further wrongdoing by the defendants and others”).
Section 1117(c) was enacted to address the type of scenario presented here -the difficulty of calculating actual damages caused by counterfeiters. See, e.g., Rodgers v. Anderson, No. 04-CV-1149, 2005 WL 950021, at *2 (S.D.N.Y. April 26, 2005) (“The rationale for this section is the practical inability to determine profits or sales made by counterfeiters.”); Gucci America, Inc. v. Duty Free Apparel, Ltd., 315 F.Supp.2d 511, 520 (S.D.N.Y. 2004) (“Congress added the statutory damages provision of the Lanham Act in 1995 because ‘counterfeiters' records are frequently nonexistent, inadequate, or deceptively kept .., making proving actual damages in these cases extremely difficult if not impossible.'”) (omission in original) (quoting S. Rep. No. 104177, at 10 (1995)), amended by 328 F.Supp.2d 439 (S.D.N.Y. 2004); accord Luban, 282 F.Supp.2d at 124.
Section 1117(c), however, “does not provide guidelines for courts to use in determining an appropriate award, as it is only limited by what the court considers just.” Duty Free Apparel, 315 F.Supp.2d at 520 (internal quotation marks and citation omitted). Many courts have looked to the analogous provision in the Copyright Act for guidance, 17 U.S.C. § 504(c), and have considered the following factors in setting statutory damage awards under the Lanham Act: (1) “the expenses saved and the profits reaped;” (2) “the revenues lost by the plaintiff;” (3) “the value of the [trademark];” (4) “the deterrent effect on others besides the defendant;” (5) “whether the defendant's conduct was innocent or willful;” (6) “whether a defendant has cooperated in providing particular records from which to assess the value of the infringing material produced;” and (7) “the potential for discouraging the defendant.” Philip Morris USA Inc. v. A & V Minimarket, Inc., 592 F.Supp.2d 669, 673 (S.D.N.Y. 2009) (internal quotation marks and citations omitted); accord Sream, Inc. v. West Village Grocery Inc., No. 16-CV-2090, 2018 WL 4735706, at *3 (S.D.N.Y. Sept. 14, 2018), R. & R. adopted, No. 16-CV-2090, Dkt. 40 (S.D.N.Y. Oct. 1., 2018); Cengage Learning, Inc. v. Bhargava, No. 14-CV-3174, 2017 WL 9802833, at *4 (S.D.N.Y. Aug. 22, 2017), R. & R. adopted, 2018 WL 1989574 (S.D.N.Y. April 25, 2018); Deckers Outdoor Corp. v. TKM Forest Hills, LLC, No. 12-CV-5986, 2014 WL 4536715, at *7-8 (E.D.N.Y. Sept. 11, 2014). The Court finds it appropriate to consider those factors here.
B. Analysis Of The Relevant Factors
Here, the factors relevant to determining statutory damages collectively point to a substantial award of statutory damages.
With respect to the first, second, and sixth factors, the Defaulting Defendants' conduct - including their failure to appear, answer, or otherwise respond to the Complaint, or comply with the expedited discovery ordered in the TRO and PI Order -have made it impossible to determine the Defaulting Defendants' profits, quantify any expenses that the Defaulting Defendants may have saved by infringing Plaintiff's Blume trademark, or assess revenues lost by Plaintiff as a result of the Defaulting Defendants' infringing and counterfeiting activities. As such, the Court may, and does, infer that the Defaulting Defendants financially benefitted to a significant degree by marketing and selling counterfeit Blume products. See AW Licensing, LLC v. Bao, No. 15-CV-1373, 2016 WL 4137453, at *3 (S.D.N.Y. Aug. 2, 2016) (“courts have supported an inference of a broad scope of operations in cases dealing specifically with websites that ship and sell to a wide geographic range”).
The third factor - the value of Plaintiff's Blume trademark - also weighs in favor of increased statutory damages. Again taking the allegations of the Complaint as true, together with the affidavit evidence, Plaintiff has established that Blume products have achieved global recognition and success as a result of Plaintiff's efforts in building up and developing consumer recognition, awareness, and goodwill in those products. By virtue of the foregoing the Blume trademark is of great value to Plaintiff and identifies Plaintiff as the exclusive source of the Blume products to which it is applied.
The remaining factors - willfulness and deterrence - further support significant statutory damages awards against the Defaulting Defendants. The Defaulting Defendants are hardly innocent infringers; to the contrary, their conduct was willful as set forth above. Statutory damages thus should be substantial enough to deter both the Defaulting Defendants and others who may be inclined to engage in similar conduct. “The need to deter other counterfeiters is particularly compelling given the apparent extent of counterfeit activity” committed by the Defaulting Defendants. Bumble and Bumble, LLC v. Pro's Choice Beauty Care, Inc., No. 14-CV-6911, 2016 WL 658310, at *5 (S.D.N.Y. Feb. 17, 2016), R. & R. adopted, 2016 WL 1717215 (S.D.N.Y. April 27, 2016); see also Carducci Leather Fashions, 648 F.Supp.2d at 504 (“a statutory award should incorporate not only a compensatory, but also a punitive component to discourage further wrongdoing by the defendants and others”).
C. The Amount Awarded
Plaintiff has requested statutory damages in the amount of $50,000 against each Defaulting Defendant. Based on there being ten Defaulting Defendants, the total statutory damages award sought by Plaintiff amounts to $500,000.
Other courts have considered statutory damages awards in cases similar to this one and awarded statutory damages in the range of $10,000 to $50,000 per mark or per infringer. See, e.g., Coach Services, Inc. v. K Ya International, Inc., No. 09-CV-4656, 2010 WL 2771897, at *3 (S.D.N.Y. June 10, 2010) ($20,000 “is an appropriate [trademark infringement] award, as it effectively serves both the punitive and deterrent purposes of 15 U.S.C. [§] 1117(c)”), R. & R. adopted, 2010 WL 2771907 (S.D.N.Y. July 12, 2010); Cartier International B.V. v. Ben-Menachem, No. 06-CV-3917, 2008 WL 64005, at *15 (S.D.N.Y. Jan. 3, 2008) ($50,000 statutory damages for each of nineteen counterfeited marks is “sufficient to meet the goals of [15 U.S.C. § 1117(c)], including compensating the Plaintiffs and deterring future violations”). Indeed, “[m]ost judges have issued awards far below the statutory maximum ... where the defendant willfully infringes on the plaintiff's mark ..., but where there is no concrete information about the defendant's actual sales figures and profits and the estimate of plaintiff's lost revenue.” All-Star Marketing Group, LLC, v. Media Brands Co., 775 F.Supp.2d 613, 624 (S.D.N.Y. 2011) (collecting cases awarding between $25,000 and $250,000 per mark).
For example, in a case similar to this one, the plaintiff sued numerous foreign defendants who, via Wish.com, marketed and sold counterfeit children's toys infringing the plaintiff's trademarks and copyrights. WowWee Group Ltd. v. Haoqin, No. 17-CV-9893, 2019 WL 1316106, at *1 (S.D.N.Y. March 22, 2019). After considering the requisite factors, the Court awarded plaintiff $25,000 in statutory damages against each defaulting defendant for a total award of $1,550,000. Id. at *4; see also, e.g., Laboratorios Rivas, SRL v. Ugly & Beauty, Inc., No. 11-CV-5980, 2013 WL 5977440, at *11 (S.D.N.Y. Nov. 12, 2013) (awarding $20,000 per mark infringed), R. & R. adopted, 2014 WL 112397 (S.D.N.Y. Jan. 8, 2014); All-Star Marketing Group, 775 F.Supp.2d at 624 (awarding $25,000 per mark for one set of marks and $50,000 for others).
Given that the Lanham Act provides for statutory damages of up to “$2,000,000 per counterfeit mark per types of goods or services sold, offered for sale, or distributed, as the court considers just,” 15 U.S.C. § 1117(c), an award of $50,000 for each Defaulting Defendant's willful violations is appropriate here. In sum, the Court finds that an amount of $50,000 per Defaulting Defendant is a reasonable and appropriate amount for statutory damages in light of the requisite factors discussed above and as a commensurate deterrent to future violations by both the Defaulting Defendants and others. Accordingly, the Court recommends an award of $50,000 against each Defaulting Defendant.
D. Post-Judgment Interest
The Lanham Act also permits a plaintiff to receive post-judgment interest “on any money judgment in a civil case recovered in a district court ... [to] be calculated from the date of the entry of the judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding the date of the judgment.” 28 U.S.C. § 1961(a). Accordingly, Plaintiff should be awarded post-judgment interest on the money judgment entered in this action. See, e.g., WowWee, 2019 WL 1316106 at *4 (granting post-judgment interest on inquest following default by defendants who counterfeited plaintiff's marks and products); Bumble and Bumble, 2016 WL 658310 at *12 (granting post-judgment interest after plaintiff's success on the merits of trademark infringement claim).
IV. Attorneys' Fees And Costs
A prevailing trademark plaintiff may recover costs, and, in “exceptional cases,” reasonable attorneys' fees. 15 U.S.C. § 1117(a); see Merck Eprova AG v. Gnosis S.p.A., 760 F.3d 247, 265-66 (2d Cir. 2014). In the Second Circuit, attorneys' fee awards under § 1117(a) are available to plaintiffs who opt to receive statutory damages under § 1117(c). Louis Vuitton Malletier S.A. v. LY USA, Inc., 676 F.3d 83, 111 (2d Cir. 2012). The Inquest Scheduling Order providing instructions for what the parties needed to file in connection with this inquest expressly addressed attorneys' fees and directed that if Plaintiff sought attorneys' fees, it must submit both supporting factual material, such as time records, and conclusions of law addressing the legal basis for fees. Plaintiff did not include any such content or supporting materials, and its submissions do not otherwise suggest that Plaintiff is requesting an award of attorneys' fees. Accordingly, no attorneys' fees should be awarded. That said, the Court's statutory damages award sufficiently compensates Plaintiff, including for its expenditure of attorneys' fees. See Malletier v. WhenU.Com, Inc., No. 05-CV-1325, 2007 WL 257717, at *6 (S.D.N.Y. Jan. 26, 2007) (award of statutory damages suffices to make plaintiff whole); Rodgers, 2005 WL 950021 at *3-4 (same).
Conclusion
For the foregoing reasons, I recommend that the Court award Plaintiff statutory damages in the amount of $50,000 against each Defaulting Defendant, plus postjudgment interest.
Procedure For Filing Objections
Pursuant to 28 U.S.C. § 636(b)(1) and Rules 72, 6(a), and 6(d) of the Federal Rules of Civil Procedure, the parties shall have fourteen (14) days to file written objections to this Report and Recommendation. Such objections shall be filed with the Clerk of Court, with extra copies delivered to the Chambers of the Honorable Paul G. Gardephe, United States Courthouse, 40 Foley Square, New York, New York 10007, and to the Chambers of the undersigned, United States Courthouse, 500 Pearl Street, New York, New York 10007. FAILURE TO FILE TIMELY OBJECTIONS WILL RESULT IN A WAIVER OF OBJECTIONS AND WILL PRECLUDE APPELLATE REVIEW.
Plaintiff shall effect service of this Report and Recommendation on the Defaulting Defendants through the same means of service provided for under the TRO and PI Order.